Scooter's Scooters is a large American manufacturer of electric scooters operating out of Boise. Currently, the company produces all of its scooters using a single manufacturing facility, its factory in town. Recently, management has been considering expanding operations to one or two additional factories. The following table presents the manufacturer's monthly short-run average total cost (SRATC) for various levels of production if it operates out of one, two, or three factories. (Note: Q equals the total quantity of scooters produced by all factories.) Number of Factories Q 100 Q=200 1 280 2 380 3 480 440 620 800 Average Total Cost (Dollars per scooter) Q = 300 Q = 400 240 320 240 240 320 240 Q500 460 380 280 Q = 600 800 620 440 Suppose Scooter's Scooters is currently producing 100 scooters per month in its only factory. Its short-run average total cost is s per scooter. Suppose Scooter's Scooters is expecting to produce 100 scooters per month for several years. In this case, in the long run, it would choose to produce scooters using

ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
icon
Related questions
Question

Note:-

  • Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism.
  • Answer completely.
  • You will get up vote for sure.
On the following graph, plot the three SRATC curves for Scooter's Scooters from the previous table. Specifically, use the green points (triangle
symbol) to plot its SRATC curve if it operates one factory (SRATC1); use the purple points (diamond symbol) to plot its SRATC curve if it operates two
factories (SRATC₂); and use the orange points (square symbol) to plot its SRATC curve if it operates three factories (SRATC3). Finally, plot the long-
run average total cost (LRATC) curve for Scooter's Scooters using the blue points (circle symbol).
Note: Plot your points in the order in which you would like them connected. Line segments will connect the points automatically.
?
AVERAGE TOTAL COST (Dollars per scooter)
800
720
640
560
450
400
320
240
160
60
0
0
100
200
300 400
QUANTITY (Scooters)
500 600
700
A
SRATC,
4
SRATC₂
-0-
SRATC
-O-
LRATC
Transcribed Image Text:On the following graph, plot the three SRATC curves for Scooter's Scooters from the previous table. Specifically, use the green points (triangle symbol) to plot its SRATC curve if it operates one factory (SRATC1); use the purple points (diamond symbol) to plot its SRATC curve if it operates two factories (SRATC₂); and use the orange points (square symbol) to plot its SRATC curve if it operates three factories (SRATC3). Finally, plot the long- run average total cost (LRATC) curve for Scooter's Scooters using the blue points (circle symbol). Note: Plot your points in the order in which you would like them connected. Line segments will connect the points automatically. ? AVERAGE TOTAL COST (Dollars per scooter) 800 720 640 560 450 400 320 240 160 60 0 0 100 200 300 400 QUANTITY (Scooters) 500 600 700 A SRATC, 4 SRATC₂ -0- SRATC -O- LRATC
5. Costs in the short run versus in the long run
Scooter's Scooters is a large American manufacturer of electric scooters operating out of Boise. Currently, the company produces all of its scooters
using a single manufacturing facility, its factory in town. Recently, management has been considering expanding operations to one or two additional
factories. The following table presents the manufacturer's monthly short-run average total cost (SRATC) for various levels of production if it operates
out of one, two, or three factories. (Note: Q equals the total quantity of scooters produced by all factories.)
Number of Factories Q = 100 Q = 200
1
440
280
2
620
380
3
800
480
Average Total Cost
(Dollars per scooter)
Q = 300 Q = 400
240
320
240
240
320
240
Q = 500
480
380
280
Q=600
ВОО
620
440
per scooter.
Suppose Scooter's Scooters is currently producing 100 scooters per month in its only factory. Its short-run average total cost is s
Suppose Scooter's Scooters is expecting to produce 100 scooters per month for several years. In this case, in the long run, it would choose to produce
scooters using
Transcribed Image Text:5. Costs in the short run versus in the long run Scooter's Scooters is a large American manufacturer of electric scooters operating out of Boise. Currently, the company produces all of its scooters using a single manufacturing facility, its factory in town. Recently, management has been considering expanding operations to one or two additional factories. The following table presents the manufacturer's monthly short-run average total cost (SRATC) for various levels of production if it operates out of one, two, or three factories. (Note: Q equals the total quantity of scooters produced by all factories.) Number of Factories Q = 100 Q = 200 1 440 280 2 620 380 3 800 480 Average Total Cost (Dollars per scooter) Q = 300 Q = 400 240 320 240 240 320 240 Q = 500 480 380 280 Q=600 ВОО 620 440 per scooter. Suppose Scooter's Scooters is currently producing 100 scooters per month in its only factory. Its short-run average total cost is s Suppose Scooter's Scooters is expecting to produce 100 scooters per month for several years. In this case, in the long run, it would choose to produce scooters using
Expert Solution
trending now

Trending now

This is a popular solution!

steps

Step by step

Solved in 4 steps with 2 images

Blurred answer
Knowledge Booster
Multiple Equilibria
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.
Recommended textbooks for you
ENGR.ECONOMIC ANALYSIS
ENGR.ECONOMIC ANALYSIS
Economics
ISBN:
9780190931919
Author:
NEWNAN
Publisher:
Oxford University Press
Principles of Economics (12th Edition)
Principles of Economics (12th Edition)
Economics
ISBN:
9780134078779
Author:
Karl E. Case, Ray C. Fair, Sharon E. Oster
Publisher:
PEARSON
Engineering Economy (17th Edition)
Engineering Economy (17th Edition)
Economics
ISBN:
9780134870069
Author:
William G. Sullivan, Elin M. Wicks, C. Patrick Koelling
Publisher:
PEARSON
Principles of Economics (MindTap Course List)
Principles of Economics (MindTap Course List)
Economics
ISBN:
9781305585126
Author:
N. Gregory Mankiw
Publisher:
Cengage Learning
Managerial Economics: A Problem Solving Approach
Managerial Economics: A Problem Solving Approach
Economics
ISBN:
9781337106665
Author:
Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Publisher:
Cengage Learning
Managerial Economics & Business Strategy (Mcgraw-…
Managerial Economics & Business Strategy (Mcgraw-…
Economics
ISBN:
9781259290619
Author:
Michael Baye, Jeff Prince
Publisher:
McGraw-Hill Education